Delegation's visit to New Zealand helps gauge China's lamb market
The increasing appetite in China for higher-value cuts of lamb is likely to have a significant impact on global supplies, producers on both sides of the world have agreed.
A delegation from the UK sheep-meat industry has just returned from a fact-finding mission to New Zealand where they met farmer, processor and stakeholder representatives to discuss the negative impact price volatility is having for sheep-meat producers, wherever they farm.
They agreed to continue to work closely together to try to better anticipate and understand the impact of volatility on their businesses, with increased market access also essential to spread the risk.
And they believe that the increasing demand for lamb, in particular higher value cuts, in China, would play an important part in the global picture.
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"New Zealand now has open access to the China market and it is creating a lot of opportunities for them which they are naturally excited about. There is a huge demand for sheep meat there and it is not just the cheaper cuts as may traditionally have been the case," said Nick Allen, English Beef & Lamb Executive director, who was among the visitors.
"With a 1.4 billion population, it doesn't need a huge percentage to have rising disposable income to see that the potential demand for higher-value cuts is significant, and this will impact on supply.
"This increased demand from the Far East will influence the global supply of lamb as New Zealand seeks to take advantage of that market – something we cannot yet do. It means we could avoid an unusually high flood of lamb cuts into the UK from New Zealand, as we got over a short period late last year.
"But we need to work closely with our colleagues in New Zealand to try to anticipate spikes and troughs in supply caused by adverse weather patterns and other factors. We must work harder to develop the sustainability of our industry while continuing to push for market access in countries we cannot yet sell into, including China."
The Agriculture and Horticulture Development Board has just secured a dedicated representative in Beijing, through the China-Britain Business Council Launchpad agreement, to work towards market access there.
Eblex co-ordinated the delegation to New Zealand, which also included representatives from the NFU and NSA. The group met Beef & Lamb New Zealand and agreed there was an opportunity over the next six months for sheep-meat producers, processors and exporters on both sides of the world to better understand market dynamics and to consider how more stable returns might be able to be generated in the future, improving the long-term viability of the sheep meat sector.
NFU livestock board chairman Charles Sercombe said: "Despite all the technology we have, there is no substitute for face-to-face meetings. These were vital to gain a thorough understanding of the pressures the New Zealand sheep-meat industry faces, and I appreciate how candid everyone was we met.
"What has come across more strongly than anything else is the common challenges we share. This has reinforced my view that there is an urgent need for all parties in supply chains to work more closely to ensure the best product for the consumer and a thriving and profitable industry, which is able to adapt to the changing world marketplace. This is true whether you farm in the UK or New Zealand."
Phil Stocker, chief executive of the NSA, said: "This trip was invaluable with both the UK and New Zealand sheep sectors learning more about the industry on both sides of the globe.
"Building closer relationships gives us the chance to complement and learn from each other, recognising that we are all part of a global farming community that can add value and improve efficiency by working together."